Prime Minister Narendra Modi’s innovative scheme for financial inclusion, the Jan Dhan Yojna was kick-started on Thursday. This scheme aims to provide bank accounts to all, with a call to end ‘financial untouchability.’ Modi said the aim is to integrate every Indian to the economic system as that is he only way to eradicate poverty. Nearly 40% of Indians are outside any kind of banking system and the purpose of the scheme is to operationalise the much touted financial inclusion mantra touted by the UPA Government in its ten-year rule.
The Jan Dhan Yojana entails providing a bank account to every Indian family. 1.5 crore accounts were opened on the first day of the project, which is a world record. Each account holder will be provided with a ‘RuPay’ debit card and an accident cover of Rs one lakk in case of any accident to the account holder. This scheme, a brainchild of Prime Minister Modi aims at providing bank accounts to 7.5 crore identified households by January 2015 which will help the government to save billions of rupees on social spending.
According to the scheme those who join up before January 2015 will be paid Rs. 30,000 additional insurance apart from Rs one lakh accident cover. The four-year program aims to help beat back the endemic corruption affecting almost every level of the bureaucracy, by channeling government welfare and work payments directly into the accounts of individuals rather than through regional and local offices.
Interestingly a similar scheme was launched by the Congress-led MUA Government in Meghalaya in 2012 and was targeted especially for women. Several women in Meghalaya now have bank accounts with an initial deposit of Rs 5000 so that they can start some enterprise. Perhaps it is the insurance part that was missing from this programme.